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Fraud Alleged In Oxygen Bar Case

ALBUQUERQUE, N.M. — The suspects: a former Las Vegas, N.M., city councilor with a history of financial crimes and a bankruptcy-prone business partner.

The victim: a potential investor who is now a missionary in Zimbabwe.

The alleged scam: selling fraudulent securities worth $50,000 in an Albuquerque oxygen bar and spa that had already closed its doors.

The state Regulation and Licensing Department’s securities division brought five felony counts against Frank Berged IV, 44, of Albuquerque, and Brenda Duggan, 45, of Corrales, in District Court in Albuquerque last Friday.

The division claims the pair promised an unnamed investor a 10 percent interest in a company called Club R, which operated an oxygen bar and spa known as Relaxations on Montgomery Boulevard in the Far Northeast Heights.

The division says the spa was “in serious financial trouble and had closed its doors” in March 2007 and that Berged and Duggan told the investor the club would use the investment to open in Phoenix.


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“Rather than open in the new location as promised, much of the victim’s $50,000 investment was used by the suspects for unrelated personal expenses and travel,” the division said in a statement.

According to the securities division, the investor is now a missionary in Zimbabwe.

Berged’s earlier financial crimes date to 1994, when he was convicted of forging San Miguel County checks while serving as a Las Vegas city councilor. And, in 2005, he pleaded guilty to misdemeanor charges in connection with what the division said was fraudulent use of a bank card issued to the New Mexico Coalition Against Domestic Violence, where Berged had briefly worked as a bookkeeper.

The division said Duggan “has filed for bankruptcy twice and has had numerous lawsuits and liens filed against her for non-payment of bills.”
— This article appeared on page A1 of the Albuquerque Journal